Bitcoin has finally staged a comeback! Following a dip to as low as $15,696.30 on November 9, 2022, analysts are now forecasting a potential surge for the world’s most renowned cryptocurrency, predicting it could exceed its previous high of $69,000 from November 2021, potentially more than doubling its previous peak.
According to a recent report by Bernstein, the price of Bitcoin is anticipated to reach $150,000 by 2025, according to a report from CNBC. The optimism stems from the potential approval of a Bitcoin exchange-traded fund (ETF) by the Securities and Exchange Commission (SEC) by the first quarter of 2024, as per analyst Gautam Chhugani from Bernstein.
This bullish forecast stands at about five times the current Bitcoin value, currently hovering around $34,000, and more than double the cryptocurrency’s peak value, which surpassed $67,000 in November 2021.
Since the start of this year, the price of Bitcoin has more than doubled, soaring from $16,675 on January 1 to around $34,443.30 at the time of writing. The surge has been largely attributed to the Federal Reserve’s substantial money printing, resulting in historically low bond yields.
Additionally, the approval of an ETF is expected to redirect up to 10% of Bitcoin’s circulating supply toward ETFs. This endorsement would enable traditional investors to directly access Bitcoin from their investment portfolios. Presently, the closest comparable product is Grayscale’s Bitcoin Trust (GBTC), holding about 3% of the total Bitcoin available, CNBC said, citing the report.
“You may not like Bitcoin as much as we do, but a dispassionate view of Bitcoin as a commodity, suggests a turn of the cycle,” Chhugani wrote. “A good idea is only as good as its timing – SEC approved ETFs by world’s top asset managers (BlackRock, Fidelity, et al), seems imminent.”
Chhugani highlighted the significance of timing in the market, emphasizing the imminent likelihood of SEC-approved ETFs by major asset management companies like BlackRock and Fidelity.
The forecast was part of a broader note wherein Chhugani initiated coverage of various Bitcoin mining firms. He indicated that the Bitcoin “halving” in April 2024, a scheduled event reducing Bitcoin rewards, would result in weaker miners being phased out, paving the way for considerable gains by the remaining miners.
Recently, Bitcoin’s value reached $35,000, marking its highest point since May 2022. The investor community remains optimistic about potential ETF approval by the year-end, especially after the SEC opted not to contest a significant court ruling in Grayscale’s lawsuit against it.
Yet, the court ruling doesn’t assure the SEC’s endorsement of a Bitcoin ETF. SEC Chair Gary Gensler has been critical of the crypto industry, highlighting concerns of fraudulence, and raising uncertainties about the regulator’s stance on crypto ETFs.
The crypto industry has faced various challenges in the past few years. Among them, the SEC’s lawsuit against Binance for securities violations earlier this year has significantly impacted the industry. Additionally, the previous year witnessed another blow as the crypto exchange FTX filed for bankruptcy. The situation intensified with allegations against the former CEO, Sam Bankman-Fried, for allegedly defrauding billions of crypto investors, leading to ongoing legal proceedings against him.